Related Experiment Videos
Episode-of-care physician payment: a study of coronary artery bypass graft surgery
J A Showstack1, D W Garnick, K E Rosenfeld
1Institute for Health Policy Studies, School of Medicine, University of California, San Francisco 94143-0936.
Insights
Physician payment reform explored episode-of-care (EOC) for coronary artery bypass graft (CABG) surgery. EOC payment is complex and costly, but selective contracting may improve quality and reduce costs.
Area of Science:
- Health economics
- Medical payment models
- Surgical outcomes
Background:
- Current fee-for-service models may not incentivize efficient care.
- Alternative payment models, such as episode-of-care (EOC) payment, are being explored.
- Coronary artery bypass graft (CABG) surgery is a significant healthcare expenditure.
Purpose of the Study:
- To analyze physician billing patterns for a cohort of Medicare beneficiaries undergoing CABG surgery.
- To evaluate the complexity and cost-effectiveness of EOC payment for CABG.
Main Methods:
- Retrospective analysis of physician billing data for 512 Medicare beneficiaries.
- Development of decision rules to define services within a CABG episode of care.
- Categorization of charges by provider type (e.g., primary surgeon, assistant surgeon, anesthesiologist).
Main Results:
- 72% of total episode charges were associated with services rendered on the day of surgery.
- Primary surgeons accounted for 47% of charges, assistant surgeons for 15%, and anesthesiologists for 9%.
- Significant complexity and cost were observed in defining and attributing charges within the CABG episode.
Conclusions:
- EOC payment for CABG is complex and potentially costly compared to other prospective payment methods.
- Selective contracting by health insurers for specific procedures like CABG may offer opportunities for cost reduction and quality improvement.
- Further research is needed to optimize EOC models for surgical episodes.
Abstract:
Paying physicians for an episode of care is a possible alternative to current fee-for-service payment. We studied physician billing patterns for 512 Medicare beneficiaries who received coronary artery bypass graft (CABG) surgery in 1983. Relatively elaborate decision rules had to be created to exclude services that were not part of a routine CABG. We found that 72% of charges for an episode were associated with services provided on the day of surgery. Forty-seven percent of charges were by the primary surgeon, 15% by the assistant surgeon(s), and 9% by the anesthesiologist. Our results suggest that episode-of-care payment is a complex, and somewhat costly, alternative to other methods of prospective payment to physicians, although selective contracting by a health insurer for an episode of care for certain procedures might both reduce costs and improve quality.